Tuesday , January 28 2020
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Airbus to Expand in UK After Brexit

Summary:
Airbus CEO Guillaume Faury announced expansion of Airbus production in the UK. Trump won't be pleased. The Brexit doom and gloomers have been proven wrong already as Airbus Pledges Expansion in the U.K. After Brexit. Chief Executive Officer Guillaume Faury said Prime Minister Boris Johnson’s Brexit deal, which will see Britain leave the European Union on Jan. 31, means the split from the bloc “is at least now for certain,” though the nature of future ties still needs to be worked out. The European aerospace giant, which employs more than 13,500 people at 25 U.K. sites and supports 100,000 supplier jobs, warned under previous CEO Tom Enders that future production might be in doubt as the prospect of a no-deal Brexit threatened to create border delays and inflate costs. “Airbus is

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Airbus CEO Guillaume Faury announced expansion of Airbus production in the UK. Trump won't be pleased.

The Brexit doom and gloomers have been proven wrong already as Airbus Pledges Expansion in the U.K. After Brexit.

Chief Executive Officer Guillaume Faury said Prime Minister Boris Johnson’s Brexit deal, which will see Britain leave the European Union on Jan. 31, means the split from the bloc “is at least now for certain,” though the nature of future ties still needs to be worked out.

The European aerospace giant, which employs more than 13,500 people at 25 U.K. sites and supports 100,000 supplier jobs, warned under previous CEO Tom Enders that future production might be in doubt as the prospect of a no-deal Brexit threatened to create border delays and inflate costs.

“Airbus is committed to the U.K. and to working with the new government on an ambitious industrial strategy,” Faury said late Wednesday at a company event in London. “We see great potential to improve and expand our operations in the U.K. this year.”

Wings for all Airbus models are made in Britain, chiefly at sites near Chester and Bristol, as well as in Belfast at a plant previously owned by Bombardier Inc. and now operated by Spirit AeroSystems Holdings Inc. The U.K. will also play a vital role in helping Airbus transition to low- and zero-carbon technology, Faury said, while also praising its increased funding for the European Space Agency.

Trump Will Suck Airbus Into the Crisis at Boeing

A few days ago I wrote Trump Will Suck Airbus Into the Crisis at Boeing

This is an election year and Donald Trump is running for reelection. Upping the ante in the European trade wars will make him look tough to his base. Never mind that the Federal Reserve concluded the trade wars are hurting the US economy, businesses and workers.

Airbus is almost certain to become a target for higher tariffs. I won’t rule out adding the Mobile (AL) final assembly line to sanctions despite Alabama being the No. 1 supporter of Trump. There is no way Alabama will vote for a Democratic challenger to Trump; it’s a completely safe state.

Those two paragraphs are according to widely respected Leeham News and Analysis. They predate this UK Airbus expansion announcement.

Three Leeham Points

  • The Trump Administration is thinking about increasing the tariffs on Airbus aircraft from 10% to 25%. It has WTO authority to boost tariffs to 100% of the value of the airplanes.
  • The Administration is said to be unhappy with EASA, the European certification regulator, taking the stance it has, insisting it wants to independently review and recertify the MAX.
  • And, unrelated to the MAX, the Administration is said to be unhappy that the EU is dragging its feet in approving the Boeing-Embraer joint venture.

Trump Caught

If Trump does what he says, even more Airbus production will move elsewhere. If he doesn't, he gets to simmer.

Regarding Brexit, please consider Brexit Collusion Between France and UK? What Really Happened?

Mike "Mish" Shedlock

Mike Shedlock
Mike Shedlock (Mish) is a registered investment advisor representative for SitkaPacific Capital Management (http://www.sitkapacific.com/). Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.

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